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Hello, everyone. Thank you for joining us, and welcome to the ZipRecruiter First Quarter 2026 Earnings Conference Call. After today's prepared remarks, we will host a question-and-answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I will now hand the conference over to Emilio Sartori, Head of Investor Relations. Emilio, please go ahead.

Thank you, operator. Good afternoon. Thank you for joining us for our earnings conference call, during which we will discuss ZipRecruiter's performance for the first quarter ended 31st March, 2026, and our guidance for the second quarter of 2026. Joining me on the call today are Ian Siegel, Co-Founder and CEO, and David Travers, President and interim CFO. Before we begin, please be reminded that forward-looking statements made today are subject to risks and uncertainties relating to future events and/or the future financial performance of ZipRecruiter. Actual results could differ materially from those anticipated in these forward-looking statements. A discussion of some of the risk factors that could cause actual results to differ materially from any forward-looking statements can be found in ZipRecruiter's quarterly report on Form 10-Q for the quarter ended 31st March, 2026, which is available on our investor website and the SEC's website.

The forward-looking statements in this conference call are based on the current expectations as of today, and ZipRecruiter assumes no obligation to update or revise them, whether as a result of new developments or otherwise. In addition, during today's call, we will discuss non-GAAP financial measures. These non-GAAP financial measures should be considered in addition to, not as a substitute for or in isolation from, GAAP results. Reconciliations of the non-GAAP metrics to the nearest GAAP metrics are included in ZipRecruiter's shareholder letter and in our Form 10-Q. Now I will turn the call over to Ian.

Thank you. Good afternoon to everyone joining us today. ZipRecruiter opened 2026 with a strong first quarter, delivering revenue of $107.5 million and beating the midpoint of our guidance. Net loss was $4.7 million, and Adjusted EBITDA came in above the high end of our guidance range at $9.7 million. At ZipRecruiter, our mission is to actively connect people to their next great opportunity. We do that by playing the role of active matchmaker. Increasing direct, meaningful conversations between employers and job seekers is a central focus of our R&D, and in Q1, we saw engagement increase across multiple metrics. First, we launched our next-generation search and matching AI engine in Q1. This represents a massive leap forward in how we drive more conversations between employers and job seekers.

This engine delivers two major upgrades: a step change in how we assess candidate qualifications and a new level of precision in interpreting job seeker intent. The results were immediate. Application volume increased by 37% for job seekers using the new engine. While only live for a subset of job seekers, we expect a full rollout by the end of Q2. We also created significant momentum with Be Seen First, a product that empowers qualified, high-intent job seekers to stand out by highlighting exactly why they are a fit for a role. Adoption is scaling fast. Over half of our paid employers now receive Be Seen First responses on their postings. In Q1, 12% of all applicants chose to Be Seen First. Only qualified candidates for a role can utilize this feature, ensuring a high-quality experience for employers.

Be Seen First candidates are nearly two times more likely to receive a message from an employer than those using traditional applications. Over the past year, we've deployed multiple products and enhancements across both sides of our marketplace. From ZipIntro and our redesigned resume database to Be Seen First and our next-generation search and matching engine, each innovation is focused on the same goal: driving more conversations between employers and job seekers. This momentum is reflected in both our data and job seeker app store reviews. With a 4.9 rating and over one million combined reviews, ZipRecruiter remains the number-1-rated job search app on both iOS and Android. Over the course of Q1, we saw a notable increase in positive reviews, specifically mentioning getting a call from an employer or landing an interview compared to Q4.

We believe the most valuable thing we can do for job seekers is get them into conversations with employers. The most valuable thing we can do for employers is deliver them candidates they want to engage with. The data is moving in the right direction. The app store reviews are one signal. The product data is another. Together, they tell a consistent story. The quality of connections happening on ZipRecruiter is meaningfully improving. All of these improvements were delivered against what remains a sluggish hiring backdrop. In Q1, the quits rate and total hires stayed near their lowest levels since 2015, while job openings were down 3% year-over-year. In spite of this subdued hiring environment, ZipRecruiter outperformed on Q1 results, and we believe this is due to our product improvements and the efficacy of our marketplace.

The pace of innovation across our marketplace is accelerating. In a market where many companies are competing on the breadth of their AI capabilities, we believe the long-term winners will be those that translate technology into real outcomes. Employers finding the right person, job seekers landing the right role, that is the bet we are making. We believe the quality of our marketplace has never been stronger, and that we are building a business that will capture disproportionate share as the hiring market normalizes. Q1 is evidence that we are moving in the right direction, and we look forward to showing you more. With that, I'll turn the call over to Dave to share some additional business highlights, financial results, and guidance.

Thanks, Ian, and good afternoon. Our performance in the first quarter reflects the continued success of our product-led strategy. I'm excited to share several highlights with you. On the SEO front, we're seeing strong growth in high-intent traffic, despite a year-over-year decline in total web traffic across the hiring category. In Q1, our engaged job seekers, defined as those who applied to job postings, grew 26% year-over-year through organic search. At the same time, we are leaning into generative AI. In March, we launched the ZipRecruiter app for ChatGPT, extending our reach directly into the AI tools job seekers are increasingly adopting. We see this as an early step in broadening our presence across generative AI platforms, and we'll look to expand our integrations over time.

Taken together, our increased share of total traffic, 26% year-over-year growth in engaged job seekers through organic channels, and a new distribution footprint across generative AI platforms, we believe ZipRecruiter is gaining share at a moment when cyclical hiring demand remains muted. That combination does not happen by accident, and we believe it positions us to disproportionately capture volume when the hiring market normalizes. After investing over $1 billion over the past 15 years to achieve over 80% aided brand awareness on both sides of our marketplace, we are now leveraging our branding expertise to empower our customers to tell their own stories with multimedia branding. In Q1, we rolled out integrated branded pages for our employer listings on ZipRecruiter, powered by Breakroom, a workplace rating and job marketplace platform, to increase visibility of employers' brands to job seekers.

These pages allow employers to move beyond static text and use video, images, and testimonials to showcase their true workplace culture. We look forward to scaling these multimedia capabilities across our entire marketplace. Finally, our enterprise strategy continues to gain traction. Adoption of our automated campaign performance solutions grew over 50% year-over-year as large employers look for more efficient hiring solutions. Our go-to-market improvements drove a 5% year-over-year increase in performance marketing revenue, proving that our technology investments are delivering for employers of every size. With that, I'll now discuss our financial results and guidance. Our first quarter revenue of $107.5 million came in ahead of our guidance midpoint, with a 2% decline year-over-year and a 4% decline quarter-over-quarter.

The year-over-year decrease was driven by a soft hiring environment, while the sequential decline reflects post-holiday seasonality, where employers join or return our platform over the course of the quarter. We finished the first quarter with over 63,000 quarterly paid employers, which was flat year-over-year and represented a 7% increase sequentially. Quarterly paid employers remaining flat year-over-year in spite of macroeconomic volatility demonstrates the stability of our employer base. The sequential growth is consistent with our historical seasonal patterns, where quarterly paid employers typically grow over the course of Q1 after the holiday slowdown in Q4. Revenue per paid employer was $1,698, down 2% year-over-year and down 10% sequentially. The year-over-year decrease reflects more muted hiring demand.

The sequential decrease was primarily driven by seasonal growth in the number of quarterly paid employers as they ramped up their hiring campaigns over the course of Q1. Our net loss in the first quarter was $4.7 million. Adjusted EBITDA in Q1 was $9.7 million, representing a 9% margin coming ahead of the high end of our guidance range. This compares to an Adjusted EBITDA margin of 5% in Q1 of 2025. Cash, cash equivalents, and marketable securities totaled $393.5 million as of 31st March. During the first quarter, we repurchased 3.5 million shares, totaling $9.4 million.

Moving on to quarterly guidance, our Q2 revenue guidance of $112 million at the midpoint represents a return to flat revenue year-over-year and 4% growth quarter-over-quarter, demonstrating the impact of our hiring solutions despite underlying macro headwinds. Our Adjusted EBITDA guidance for Q2 is $13 million at the midpoint, representing a 12% margin. Looking beyond Q2, we continue to expect hiring demand to follow a typical seasonal cadence throughout 2026, albeit at subdued levels. Under this scenario, we expect to achieve flat year-over-year revenue in 2026, which is a five percentage point improvement over the 5% decline in 2025.

In this scenario, we also believe Adjusted EBITDA margins can expand by 5 percentage points from 9% in 2025 to 14% in 2026. This margin expansion reflects our commitment to operational efficiency alongside targeted investments aimed at capturing growth. The stabilization in the business and accelerating pace of innovation we've seen in our marketplace are encouraging. We remain confident that our focus on driving more meaningful conversations between employers and job seekers will position ZipRecruiter to outperform the broader hiring category over the long term. With that, we can now open the line for questions. Operator?

Your first question comes from Ralph Schackart with William Blair. Please go ahead.

Good afternoon. Thanks for taking the question. First question maybe, if you could talk about the differences you might be observing between SMB and enterprise segments. Sounds like you're making some good traction within enterprise. As 2026 progresses, you know, how would you expect perhaps the behavior within each of these segments to perhaps change? I have a follow-up.

Great. Thanks, Ralph. This is Dave. Yes, we've been pleased with the execution we've seen on both sides of the customer segments, SMB and Enterprise. Enterprise mainly comprises performance marketing revenue, that was up 5% year-over-year. That continues a long-term trend of expanding our percentage of revenue that comes from Enterprise. 24% of revenue this quarter. If you go all the way back to our S-1 pre-COVID in Q1 of 2019, we were at 12% of revenue. We've doubled our percentage of revenue, and we expect to continue to expand revenue there over time. As it evolves over the course of the year, I think we expect to, as I said, continue to see that.

What we've seen in talking to the customer base from both sides is consistent with the macro data we've seen. We're in a subdued but relatively stable environment, and that captures the mood of employers on both sides of the marketplace. They're responding to conversations being driven, and job seekers are responding to that as we talked a lot about in the letter. We expect to continue to see the benefits of that as we continue to execute this year. As consistent with our guidance, we were guiding to double our top line growth versus what we did Q2 over Q1 last year, showing $4.5 million of growth top line at the midpoint, as opposed to just over $2 million in the same quarters last year.

Great. Thanks, Dave. Then just a follow-up, maybe shifting gears a little bit. You talked about, you know, the Zip app for ChatGPT. Just curious what you're learning there. I think you talked about expanding potential integrations. You know, any more color you could add on the product front there would be great. Thank you.

Well, the new app went live on ChatGPT, on a percentage basis, the growth of LLMs in general has been impressive as a new traffic source. Overall, LLMs still represent a tiny contributor in the overall mix of where traffic comes from to ZipRecruiter, it's good to be there at the beginning and to enjoy the ride up with them as they become an ever more popular way for job seekers to look for work.

If you would like to ask.

Great. Thanks, Ian Siegel. Thanks, David Travers.

If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. The next question comes from Justin Patterson with KeyBanc. Please go ahead.

Great. Thank you very much. Good afternoon. I'd love to hear more about just the upcoming rollout of the next generation AI engine. Sounds like that's had some really strong returns so far. How are you thinking about that as a potential market share driver in a market that's still a little bit subdued here? The second question, just as a quick follow-up. We've seen a lot of companies just trying to balance the productivity benefits against the rising token costs from gen AI tools. I'd love to hear more about how you're thinking about that dynamic and what it might mean toward your longer term headcount needs. Thank you.

I'll take the second question first and then go to the first question last. AI is permeating really every department within our company. It's driving extraordinary efficiencies across the board, which we haven't looked at as a cost saving opportunity as much as we've looked at it as a mechanism by which we can realize and increase our ambitions. If anything, it has accelerated our roadmap as opposed to saved us money. You can see the output of that acceleration in Q1, where multiple large scale initiatives, some of which had been worked on for over one year, were able to deploy. The next generation search engine is one of those. It increased applications by 37% for the job seekers who were exposed to it.

We expect all job seekers to be on the next-gen search engine by the end of Q2. It's really exciting. This algorithm, and the other components of this were, they were retrained to prioritize more meaningful signals, for job seekers in terms of the depth of their interest and roles. We can see that play out when we use those algorithms to deliver results in that they're applying at a far higher rate, and these are jobs that they are far more qualified for at the same time. When they do apply for those jobs and when they are qualified for those jobs, adoption of Be Seen First has been exciting.

We saw 12% of total applicants choose to Be Seen First when they applied, and this is conferring an extraordinary advantage to them because employers who are looking at their list are seeing these very interested candidates who have now got a mechanism to show their enthusiasm. They're not just qualified, they're eager, and that is coming through, and employers are engaging with those candidates at almost twice the rate that they're engaging with candidates who go through the normal apply process. Overall, when we look at all the features that we've launched, not just in this quarter, but really over the last three to four quarters, and it's including things like ZipIntro, it's things like our redesigned resume database, the acquisition and deployment of Breakroom. What you see is that the strategy we've built is working, and it's not me saying that.

It's not just me. It's the job seekers. I've been really excited reading the reviews and seeing the spike in the specific language that those reviews contain. The job seekers are using the language that we use internally when we talk about our objective. They are saying that they are getting more interviews and they're getting more phone calls from employers. They are saying, "ZipRecruiter works." That's exactly how we look at it internally and how we describe it. It's really rewarding to see the strategy paying off both quantitatively and qualitatively here. There's so many more improvements to come. We're really excited about the momentum we have here, and AI is proving to be an incredible accelerator of our ability to rapidly deploy these improvements.

Your next question comes from Josh Chan with UBS. Please go ahead.

Hi, this is Karan Singh Ranial. I'm for Josh. Thanks for taking our questions. I wanted to ask on the margin because the margin certainly came way above what we expected. I'm just wondering if you can provide more color on what drove that upside against like maybe your internal expectations, because it also came above the guide as well.

Greg, thanks. This is Dave. Good question. Yeah, the EBITDA margins this past quarter did come in above expectations and above the high end of the range we'd said earlier. Obviously, when you look at it from a year-over-year basis, you know, we've been driving efficiency across all three major categories of expense, G&A, sales and marketing, and R&D. However, versus our expectations of what we had last quarter, as we've said many times, we're scientists, not artists, when it comes to sales and marketing investments. This quarter, the team did an extraordinary job of looking for and finding high ROI marketing opportunities and areas to invest in our go-to-market. We saw that in the results, and the results were that we came in above the high end of the range.

Obviously, that gives us increasing confidence in our ability to achieve the likely scenario we laid out for the whole year, which is, you know, top line being flat, which is 5 percentage points better than prior year, obviously. At the same time, improving bottom line margins from 9% to 14% for the full year, which is also 5 percentage points improvement along the bottom line. That execution this quarter gave us even more confidence about our ability to do that, and we felt great about it.

Very useful. Thank you.

That is the end of the Q&A session. This concludes today's call. You may now disconnect.

Thank you for standing by. My name is Jordan, and I'll be your conference operator today. At this time, I'd like to welcome everyone to ZipRecruiter Q4 2025 Earnings Call. [Operator Instructions] I would now like to turn the call over to Emilio Sartori, Head of Investor Relations. Please go ahead.

Thank you, operator, and good afternoon. Thank you for joining us for our earnings conference call, during which we will discuss ZipRecruiter's performance for the fourth quarter and full year ended December 31, 2025, and our guidance for the first quarter of 2026. Joining me on the call today are Ian Siegel, Co-Founder and CEO; David Travers, President; and Tim Yarbrough, CFO. Before we begin, please be reminded that forward-looking statements made today are subject to risks and uncertainties related to future events and/or the future financial performance of ZipRecruiter. Actual results could differ materially from those anticipated in these forward-looking statements. A discussion of some of the risk factors that could cause actual results to differ materially from any forward-looking statements can be found in ZipRecruiter's annual report on Form 10-K for the year ended December 31, 2025, which is available on our investor website and the SEC's website. The forward-looking statements in this conference call are based on the current expectations as of today, and ZipRecruiter assumes no obligation to update or revise them, whether as a result of new developments or otherwise. In addition, during today's call, we will discuss non-GAAP financial measures. These non-GAAP financial measures should be considered in addition to, not as a substitute for or in isolation from, GAAP results. Reconciliations of the non-GAAP metrics to the nearest GAAP metrics are included in ZipRecruiter's shareholder letter and in our Form 10-K. And now I will turn the call over to Ian.

Thank you. Good afternoon to everyone joining us today. 2025 was a year of stabilization and strategic execution for ZipRecruiter. After multiple quarters of sequential growth, I'm pleased to share that we achieved year-over-year revenue growth in Q4 '25, the first time a quarter has grown year-over-year since Q3 of 2022. Throughout 2025, we remain focused on our mission to actively connect people to their next great opportunity by delivering high-impact product enhancements. We upgraded ZipIntro and our resume database to drive faster connections, deployed new AI-powered suggested screening questions to decrease the time it takes employers to vet the candidates they receive, and optimized our automated campaigns to deliver better performance for our enterprise clients. In January of 2026, we took another leap forward with the launch of Be Seen First, a product which enables job seekers to jump to the top of an employer's candidate list. Job seekers earn this advantage when they tell the employer why they are excited about the role and what skills they bring to the table. The results are promising. Be Seen First candidates are nearly 2x more likely to have a conversation with an employer. Following the sequential growth in Q2 and Q3 of 2025, Q4 '25 marked a return to year-over-year revenue growth. We achieved this milestone despite a challenging macroeconomic backdrop. That said, hiring demand in Q4 '25 was soft. Hiring demand dropped below what normal seasonality would have predicted and job openings declined 10% year-over-year. As a result, Q1 '26 started from a lower base of paid employers. Our Q1 '26 revenue guidance of $106 million at the midpoint reflects this lower holiday baseline. However, in Q1 of '26, paid employer trends have rebounded year-to-date. Those trends are, in fact, stronger than the trends we called out as noteworthy in Q1 of '25. We are encouraged by the momentum we see in performance marketing revenue. Year-over-year performance marketing revenue increased 5% in Q3 of '25 and 9% in Q4 of '25. Our go-to-market motion and product offerings continue to resonate with and drive value for our larger enterprise customers. This performance gives us confidence that our product improvements and technology investments are driving us forward in this environment with our underlying momentum intact. For the full year 2026, we expect hiring demand to follow a typical seasonal cadence, albeit at subdued levels given the lower starting point post holidays. We believe a likely result in this scenario is for us to achieve flat year-over-year revenue in 2026 compared to the 5% decline in 2025. Further, in this scenario, we expect adjusted EBITDA margins to expand by 5 percentage points from 9% in 2025 to 14% in 2026. This improvement reflects our rigorous cost discipline alongside targeted investments aimed at capturing growth. In addition to addressing our business specifically, we have been receiving many questions about AI and its impact on the labor market. While some attribute the current hiring slowdown to AI displacement, ZipRecruiter employer survey data tells a different story. According to ZipRecruiter customer responses in our Q4 2025 Annual Employer Survey, the current labor market trends are primarily driven by economic factors, such as lower customer spending or cost-cutting mandates rather than technology-driven automation. AI is currently having little to no impact on our customers' hiring plans. This matches the sentiment from a large number of economists on the topic. Over the long term, we expect AI to be a substantial boon to the labor market. History shows that major technological shifts display specific roles, but ultimately unlock productivity and enhance labor demand. We believe AI will follow a similar trajectory. We further believe ZipRecruiter is uniquely positioned to lead this next wave of AI-driven acceleration. Since our inception, we have invested over $1 billion to build an enduring brand that resonates with both employers and job seekers. Our proprietary AI matching technology trained on billions of interactions continuously learns to surface the right roles and deliver qualified candidates faster. Our team and our technology investments are laser-focused on continuously improving the process of finding a great job or a great employee. ZipRecruiter remains committed to its mission of actively connecting people to the next great opportunity through every economic cycle. We believe we will continue to lead the shift in recruiting from offline to online, and we are prepared for this new wave of AI-driven innovation. Before I turn the call over to Dave, as you read in our shareholder letter, our CFO, Tim Yarbrough, has decided to pursue a new opportunity and will be departing ZipRecruiter. On behalf of the Board and the entire ZipRecruiter team, I want to thank Tim for his over a decade of dedicated service. We wish him continued success in his next opportunity. Dave Travers, our current President and previous CFO of 6 years, is stepping in as Interim Chief Financial Officer effective February '26. Dave's deep familiarity with our business, financial operations and history will ensure a seamless transition during this interim period. We've also initiated a comprehensive search for a permanent CFO. And with that, I'll turn the call over to Dave to share some business highlights.

Thanks, Ian, and good afternoon. Our performance in the fourth quarter reflects the continued success of our product-led strategy. Even in a complex hiring environment, our investments in matching technology and seamless integrations are delivering clear value to both employers and job seekers. I'm excited to share several highlights with you. Q4 '25 revenue reached $112 million, representing 1% year-over-year growth. This is a significant milestone, marking our first quarter of year-over-year growth since the market decline began in Q3 of '22. This performance is consistent with the scenario we outlined over the course of 2025, and we believe our execution, brand resilience and strong market position overcame what continues to be a challenging macroeconomic backdrop. We finished the year with over 59,000 quarterly paid employers in Q4, up 2% year-over-year and down 12% sequentially, consistent with historical seasonal patterns. This is our second consecutive quarter of year-over-year expansion, signaling the long-term health of our employer base. This January, we launched Be Seen First, a new product designed to help job seekers break through the application black hole and turn one-way applications into real 2-way conversations. By adding a short note to their application, job seekers moved to the top of an employer's applicant list, highlighting essential skills and enthusiasm that resumes often missed. This provides recruiters with critical context and surfaces the most engaged talent. Employers are prioritizing these high-intent applicants and Be Seen First candidates are nearly 2x more likely to have a conversation with the employer. In response to the shifting SEO landscape, we optimized our marketplace for generative AI discovery. This drove a significant increase in engagement with site visits from AI engines more than doubling year-over-year in Q4. Additionally, ZipRecruiter's job seeker traffic outperformed our largest competitors throughout 2025, validating our ongoing product improvements. By reaching job seekers regardless of where they begin their search, we believe we are uniquely positioned to capitalize on the eventual acceleration of U.S. hiring. Since its U.S. launch in 2025, Breakroom has published over 16,000 employer profiles, powered by 1.6 million employee ratings. We recently integrated these ratings directly into ZipRecruiter, enhancing 8.7 million job postings and over 9,000 company pages with transparent workplace insights, providing job seekers with transparency to better evaluate potential employers and increasing the likelihood of a strong long-term match. In 2024, we launched ZipIntro, an AI-powered solution that speeds up hiring by rapidly connecting employers and job seekers for face-to-face conversations. Enterprise adoption of ZipIntro grew consistently throughout 2025. In Q4 alone, scheduled sessions increased 17% sequentially and expanded by more than 5x year-over-year. To further optimize the platform, we recently made a number of targeting improvements that drove a 32% increase in sessions that met or exceeded RSVP targets, delivering a more predictable candidate flow for employers. We've enhanced our resume database to allow employers to filter by recent platform activity, such as whether they are new to the ZipRecruiter marketplace or if the candidate recently updated their profile. Employers are finding these real-time insights incredibly valuable. The resume unlock rate for candidates with these activity labels is 66% higher than those without. When thinking through specific questions to ask candidates, employers often struggle when starting from the blank page. In Q4, we launched an AI-driven tool that automatically generates tailored screening questions. Employers have quickly embraced this upgrade with 93% of new employers using our AI recommended screening questions in Q4. By automating this key step, we drive higher quality connections faster. ZipRecruiter's enterprise-focused strategy is gaining significant traction, fueled by high demand for automated tools. In Q4, adoption of our automated campaign performance solution increased 32% year-over-year. This and other enterprise enhancements led to a 9% year-over-year increase in performance marketing revenue in Q4, an increase from 5% growth seen in Q3. Despite a complex hiring landscape, these results demonstrate that our programmatic tools are successfully delivering the efficiency and candidate quality that large employers prioritize. For over a decade, ZipRecruiter has invested in building a network of over 180 ATS integrations to streamline the enterprise hiring process. This momentum continued in Q4 with the launch of an enhanced Workday integration and a new Bullhorn partnership. By connecting with these major ATS platforms, recruiters can now source talent from our resume database and export candidates to their preferred system with a single click, drastically reducing applicant friction and accelerating time to hire. With that, I'll now turn the call over to Tim to run through the financial results. Tim?

Thank you, Dave, and good afternoon, everyone. Our fourth quarter revenue of $111.7 million represents 1% growth year-over-year and a 3% decline quarter-over-quarter. Our first year-over-year increase since Q3 of 2022 was primarily driven by higher performance-based revenue from enterprise employers, which grew to 25% of total revenue. The sequential decline is consistent with seasonal hiring patterns in the fourth quarter. We finished the year with over 59,000 quarterly paid employers, representing a 2% increase year-over-year and a 12% decrease sequentially. This marks our second consecutive quarter of year-over-year growth, demonstrating the stability of our employer base despite macroeconomic volatility. The sequential decline is consistent with our historical seasonal patterns and reflects the typical slowdown of hiring during the holiday period. Revenue per paid employer was $1,889, down 2% year-over-year and up 10% sequentially. The year-over-year decrease reflects continued softness in hiring demand, particularly among SMB customers. The sequential increase is primarily driven by the seasonal reduction in the number of paid employers in the fourth quarter. Our net loss in the fourth quarter was $0.8 million. Adjusted EBITDA in Q4 '25 was $16.2 million, equating to a margin of 15%. This is higher compared to 13% in Q4 '24 and 8% in Q3 '25, with increases driven by a return to revenue growth and continued expense discipline. Our full year adjusted EBITDA margin of 9% exceeded the mid-single-digit expectations we shared at the beginning of the last year. Cash, cash equivalents and marketable securities was $409.1 million as of December 31, 2025. During Q4 '25, we repurchased 1.8 million shares totaling $8 million. As Ian mentioned, after more than 10 incredible years at ZipRecruiter, I'll be stepping down from my role as CFO to pursue a new opportunity. I'm deeply grateful for the growth and experiences that have shaped both my career and me personally. Thank you to our amazing employees for your dedication and partnership. It's been an honor to be a part of this team, and I'm excited to see how ZipRecruiter will continue to transform how hiring is done. With that, I'll pass it back to Dave to discuss our guidance.

Thanks, Tim. I echo Ian's comments, and we wish you luck in your future endeavors. Moving on to quarterly guidance. Our Q1 2026 revenue guidance of $106 million at the midpoint, down 4% year-over-year and 5% sequentially, reflects the lower baseline of paid employers as we started Q1. Our adjusted EBITDA guidance midpoint of $5 million represents a 5% margin, which is flat year-over-year and demonstrates our financial flexibility as we navigate the current labor market backdrop. Looking beyond Q1, we expect hiring demand to follow a typical seasonal cadence over 2026, albeit at subdued levels given the lower starting point post holidays. We believe a likely result in this scenario is for us to achieve flat year-over-year revenue in 2026, which is a 5 percentage point improvement over last year. In this scenario, we expect adjusted EBITDA margins to expand by 5 percentage points from 9% in 2025 to 14% in 2026. This improvement reflects our continued cost discipline alongside targeted investments to ensure ZipRecruiter emerges from this cycle in a position of strength. The stabilization in the business we've seen despite a weak hiring environment is encouraging, and we remain confident in our long-term growth opportunity. We believe our flexible operating model and healthy balance sheet position ZipRecruiter to take advantage of growth opportunities and position us to outperform the broader hiring category over time. With that, we can now open the line for questions. Operator?

[Operator Instructions] Your first question comes from the line of Eric Sheridan from Goldman Sachs.

Tim, thanks for all the help over the years, wishing you the best of luck. Maybe 2, if I can. First, if you look at the demand environment you're facing right now, any different characterizations you would give on the employer side from what you're seeing from large enterprises relative to SMB? And any indications how that might change as we progress into Q1 and deeper into the year?

Eric, this is Dave. Great question. Yes. So what we saw last quarter was in the latter half of the quarter over the holiday period a -- after a strong start to the quarter was a slowdown in SMB demand, particularly. And we've been encouraged since the beginning of the year, as we said, that SMB demand looks as good or actually slightly better than last year and better than we've seen in several years. So our expectation is that from a lower baseline, given the weak latter half of holiday period of last quarter, from that lower baseline, we'll see a stable overall macro environment and that our ongoing investments and continued operational improvements as we just detailed, ZipIntro, resume database and most importantly, perhaps our execution in enterprise, where we see a similarly -- forecasting as the most likely scenario, a similarly stable demand environment but where our execution and obsession with hitting customers' targets, defining clearly for them what their target is and what their definition of success is and then making sure we hit it and are having our -- both our product and our go-to-market teams work relentlessly to make sure that happens. That's paying off, and we see it -- for the first time in 4 years, seeing slight sequential growth in performance marketing revenue in Q4 versus Q3. So what we foresee is -- we're ready for a wide range of scenarios as always, but the most likely scenario being the overall demand environment for both SMB and enterprise being flat from this lower start and that our investments allow us despite a weak starting point for -- to start the year in Q1 that we get to flat this year and are able to expand margins as we do it so that we're increasing revenue by 5 percentage points versus last year and increasing margin by 5 percentage points at the same time.

Your next question comes from the line of Ralph Schackart from William Blair.

Maybe just a follow-up on Eric's question. Just trying to square a little bit, I guess, some of the more soft conditions you saw in Q4 after a strong start compared with, I guess, a stronger rebound in Q1, particularly I think you called out SMB. Anything that you sort of call out there for the, I guess, the dramatic or pretty sharp rebound there? And then two, just in terms of the traffic you're seeing from the LLMs, can you maybe sort of walk us through how that traffic is behaving, performing, perhaps converting? And then is it at a level perhaps in 2026 when it could start to impact the results? Just any other color on the LLM traffic would be great.

Thanks, Ralph. This is Dave. I'll take the first one and let Ian take the second one. So on the soft Q4, I think it very much -- what we saw in Q4 very much mapped to what the job openings numbers from the government look like where we saw that 10% decline. And each -- even when you seasonally adjust it, December is always the hardest month of the year to forecast and is always the seasonally weakest month. But even when you adjust for seasonality as the government does in their official data, there was a month-over-month decline each month in Q4 in terms of job openings, and that's very consistent with what we saw. And as we look at it, as we always say, our employer base looks like the whole U.S. economy. But when we look at particular areas of weakness and strength, health care remained resilient as it has for several years now and demographic changes and other structural reasons for that in the U.S. economy. But on the flip side, retail, food service, education were all areas of weak spots during the quarter, and we saw those degrade. And then to the point I said earlier, starting January 1, we saw a different story where we've seen a nice pickup in activity. And so that gives us the confidence to say the most likely scenario of those that we prepare for is that we will be flat from that lower baseline for the year.

And speaking to the LLM question, to give context, ZipRecruiter gets traffic from a wide array of different media sources and sites, and that includes everything from other job sites to organic traffic to SEM to response advertising and LLMs are just one part of the mix. What makes them interesting is they are the fastest growing in terms of both they themselves as a category as well as the traffic that we are getting from them. However, in the overall mix of traffic that ZipRecruiter gets, overwhelmingly still traffic that is highly engaged and active on the site is still coming from the variety of traditional sources. The difference between LLM traffic and those sources is not much. They are active job seekers who are eager and engaged. They are still continuing to grow at a healthy pace, and we are excited about the momentum that we see with LLMs.

Your next question comes from the line of Trevor Young from Barclays.

First one, just as we think about the cadence of growth throughout the year, it would kind of suggest that 1Q is maybe the low point for the year and you would exit the year at low single-digit territory or something like that, such that you're flat overall even with tough compares. What kind of informs that view that growth will accelerate from here given that backdrop? Particularly because you are seeing EBITDA margin expansion, so that maybe suggests not leaning in on marketing meaningfully. And then second one, just on capital allocation. You have about $200 million in cash on hand, Guide implies free cash flow maybe improves a bit here in '26. Clearly, a willingness to buy back stock in the last year. Should we expect opportunistic repurchases of the stock given a bit of an uptick in the outlook here? And then relatedly, any thoughts on the trade-off of stock versus debt repurchases because I know a lot of folks on the credit side also care on that.

Great. Thanks, Trevor. So in terms of the cadence throughout the year, I think what gives us confidence is, a, what we've seen year-to-date since January 1; and b, going back longer than year-to-date, the momentum we have with enterprise. And to the point you made, which is astute that margins going up while we see the cadence of improvement over the course of the year being the most likely scenario is consistent with enterprise continuing to outperform where we're not as -- the demand generation is much more sales-led and much less marketing led on the enterprise side of things. And so those teams are more -- the expense line on those teams is more stable and preexisting, and we see a lot of investments that we've made over the past couple of years starting to pay off and is less dependent on same quarter sales and marketing. Obviously, we remain flexible to and we'll adapt based on changing environments we see, but that's the most likely thing we see, and we see more than just dating back to January 1 in terms of momentum there with that part of the business. And then to your question on capital allocation, so our sort of strategic framework remains the same. The top priority always is organic growth. We were not just EBITDA profitable last year, but free cash flow profitable as well and obviously talked about seeing expanding margins this year. So in terms of organic growth, we're well covered, but we'll always prioritize that first. The second priority is M&A opportunities. You saw us take action there in terms of Breakroom where there's a really strong value proposition to both job seekers and employers about how our entire marketplace gets stronger with better employer branding and giving job seekers the real straight dope on what it's like to work -- in frontline workers, in particular, what it's like to work at a particular employer. The third priority is return of capital. And so as you pointed out, we've been a consistent returner of capital last quarter, about $8 million for about 1.8 million shares. And every single time we have an opportunity to allocate capital, we think about what are our resources. We currently have a very robust balance sheet and lots of liquidity, as you mentioned. And we look at the different opportunity set of different opportunities to repurchase shares or bonds or whatever, as you mentioned, and look at the ROI there, and we'll take action accordingly. You've seen us do that before. We will continue to evaluate that as we see opportunities to do so.

Your next question comes from the line of Josh Chan from UBS.

Good luck, Tim. I guess maybe just 2 questions. So I guess, first, what do you make of the Q4 slowdown and then Q1 recovery? And relatedly, why doesn't the Q1 recovery get you back to the same spot? Is it just like not enough of a recovery in magnitude? And then the second question would be, are you seeing meaningful changes in terms of how employers are trying to find candidates as in moving away from the traditional resume? I mean you launched this Be Seen First feature, which allows people to feature different things other than their resume. So just curious if something like that is starting to happen in the environment?

Yes, go ahead.

So on the first one, your question is a good one. So the way we think about it in terms of the cadence in Q1, it is very typical in Q1, given the seasonality, as I mentioned or we mentioned before, that the holiday period is the weakest period of the year seasonally, then Q1 can look fairly flat to Q4 in a typical year, plus or minus a couple of points. But it's really a story of building throughout the quarter from a lower starting point given what happens, the slowdown over the holidays, especially in the SMB part of the business. And so what we see here is just a steeper climb. And the starting point was lower. The trend line within the quarter looks good, but we're just starting from a lower point where the SMB part of the business was a little bit weaker over the course of late November and December, which is what causes that cadence.

And then on Be Seen First, without question, the world of recruiting is experiencing a renaissance as it relates to both the way candidates are sourced and the way -- the opportunities they have to communicate with the employers and the hiring managers. Resumes are very much still in play. They are a necessary part of a comfortable expected process that employers are not willing to let go of. What Be Seen First is, it's really a mechanism for job seekers to show their enthusiasm, to stand out when they apply to a job in a novel way, and job seekers are using it exactly as we intended. They are not spamming employers with Be Seen First. They're being selective about which jobs that they express their enthusiasm for and employers are responding as we would expect, which is in a sea of candidates, many of whom resumes look highly qualified for the role in which they are applying. They are looking for other signals that will allow certain candidates to stand out from the rest of the pack. A candidate participating in Be Seen First, showing their enthusiasm and getting pushed to the top is not only advantaging themselves, they're actually doing the employer a favor by giving them one more method from which to assess the pool of candidates they received to decide who were the very best that they want to bring in for an interview.

Your next question comes from the line of Kishan Patel from Raymond James.

This is Kishan Patel on for Josh Beck. You mentioned in the shareholder letter that you're optimizing the platform for Gen AI discovery. How do you think about optimizing the ZipRecruiter platform for agentic search or engagement by job seekers?

Well, this is certainly a topic that we are spending a lot of time thinking about. And we are excited about the potential and opportunities that is represented by AI. There are so many different directions we could choose to take this in. And certainly, already AI is permeating our site. I mean you can go all the way back to our S-1 when we first went public where we described ourselves as an AI-powered marketplace long before there was ever an LLM and everyone was talking about AI. And when we talked about AI, we were really talking about the matching engines that we built that are powered by those billions and billions of interactions between employers and job seekers, which is what allows us to not only do an exceptional job of matching keywords and resumes to the keywords and job descriptions, but also to benefit from what's known as the wisdom of the crowd, where insights can be gleaned by the different AI methodologies that we were applying in order to find the very best jobs for job seekers and the very best candidates for employers. As we look at our own service today, already, you can see AI making its way in. We talked about suggested screening questions in our shareholder letter. That is a product that has reached massive levels of adoption on our product. It's skyrocketed with the launch of suggested screening questions. The difference between putting a blank page in front of an employer and saying, come up with screening questions versus putting a set of AI-created pre-written screening questions in front of them, has been fundamentally night and day. It has been a sea change in how our product works and how applications are processed, and it's fantastic for employers because again, employers are always looking for signal, how can I differentiate between the seemingly equally qualified candidates who I have received, screening questions is a fantastic tool for that. I would expect you will hear many more AI-driven features coming through the ZipRecruiter development team and entering into our platform over the coming years. And I think you will see that AI becomes a fundamental tool and a fundamental advantage for ZipRecruiter to enhance the marketplace that we have already created.

There are no further questions. That concludes the question-and-answer session. That also concludes today's meeting. You may now disconnect.